DURBAN - Troubled retailer Steinhoff International informed its shareholders on Friday that it had launched a consent request to obtain the formal support of the financial creditors to settle a number of claims flowing out of its 2017 accounting scandal.
Steinhoff said it had engaged in active discussions with litigants, their legal representatives, creditors and other relevant parties since it proposed a R16.5 billion settlement in July.
Chief executive Louis du Preez said the settlement of the legacy legal claims remained the group’s top priority. Du Preez said Steinhoff was focused on securing the route towards the implementation of its previously announced proposal.
“Discussions with the various parties are progressing and the actions being announced today demonstrate that headway is being made,” Du Preez said. “We remain confident that the proposed settlement is in the best interests of all stakeholders and we look forward to receiving the levels of support necessary for implementation of the proposed settlement.” Steinhoff has been facing challenges as a result of a number of parties involved across multiple jurisdictions.
The group said the process had become more complex and time-consuming than originally anticipated.
It said it had clarified key points and to continue the preparatory work necessary to implement the proposal and to settle the claims. “While further work is required to achieve this outcome, including securing the support of certain counterparties who have not yet agreed to do so, the process remains on track,” the group said.
Steinhoff expects the period in which to obtain consents under the various finance documents to last approximately three weeks.
The group said it also anticipated that it would receive the necessary consents within this time frame.
“For certain of Steinhoff’s financial instruments, all lender consent is required, although abstention is not a vote against the proposal, and in the event that the necessary consent levels are not achieved, Steinhoff will consider using a UK scheme of arrangement to obtain the required consents,” Steinhoff said.
The group said should the scheme be required, it would take approximately eight weeks following the expiry of the lender consent deadline.
Steinhoff has recently applied to the Financial Surveillance Department of the South African Reserve Bank (Finsurv) for consent to the cross-border payments to be made as part of the proposed settlement.
“There is no fixed timetable for Finsurv to respond to the application, but Steinhoff expects to remain in active discussions with Finsurv on its application,” the group said.
Steinhoff rose 2.7 percent on the JSE on Friday to close at 75cents.
BUSINESS REPORT